Insurance Benefits of NZ Mine Blast Victims Still Cloudy, PwC Says

Lucas Gilmore, “Big 4″ observer

December 16, 2010 /

NEW ZEALAND – Survivors and kin of 29 victims of the November 25 Pike River methane gas explosion may have to wait for a long time before they could avail of the insurance benefits due them from the mining company, PwC receiver John Fisk said.

November 25 was the second fateful day for the Pike River miners following the same methane gas explosion that ripped through the site November 19, the worst in New Zealand for over 90 years.

As relatives and survivors of the blast continue to struggle melting down the traumatic accident, the uncertainty that threatens their claim to the full $ 100 million insurance benefits is an added burden as Pike River’s receivers said these days do not seem to be the right time to come up with figures.

Fisk said the full amount of insurance benefits remained unclear as of the moment due to the incomplete assessment of the total damage in the mine, making it hard to say how much the beneficiaries could claim exactly from the $100 million maximum value of the insurance benefits.

The mining company has yet to pay the $80 million it owes to BNZ and New Zealand Oil and Gas secured creditors, while another 10 to 15 million is claimed by its contractors, Fisk said.

Authorities are currently removing the remaining gas samples in the mine site.

A royal commission established by the New Zealand government has started its investigation into the accident, the result of which would dictate the future of the mining industry in the country, Prime Minister John Key said.

Earlier, in November 2010, PWC predicted, that after the 2008 global recession, mid-tier miners’ revenue in neighbouring Australia managed to record a 32 percent high with increased market capitalization.

PwC’s report, Aussie Mine — Rise and Shine, showed about 25 percent increase in the combined revenues of the mid-tier 50 for financial year ended June 2010, from $8.5 billion to $11.3 billion.